user gdeui - naen

User gUideTo The Looking AheAd reporT

For groUp TrAining orgAnisATions

CONTENTS

INTrOduCTION Pageno.

Introduction Insidefrontcover

Usingthisdocument 1

Examiningyourperformance 1

Regionalperformance 2

Industryperformance 2

ReadingAppendix1 3

PositioningyourGTOwithintheindustry 4

Readingthegraphs 4

Peerperformance 5

Forecastingfutureprospects 6

Regionalsummarytables 6

Regionalrankings 6

GTOGrowthandthreatstogrowth 7

Optimisationanalysis 7

Reviewingyourstrategicplan 8

SummaryissuesfromStateGTApresentations 8

Furtheradviceandinformation 9

Appendix1ExecutiveSummaryfromtheLooking Aheadreport 10

Appendix2KeyMessagesfromtheLooking Aheadreport 17

The Looking Ahead report commissioned by Group Training Australia was intended to provide a fundamental review of the group training business model after 30 years of operation and a foundation for the industry’s future strategic planning.

Thatdocumenthadmultipleaudiences.Thisguideisintendedspecificallytoassistgrouptrainingorganisationsaccessandusethedatacontainedinthereportfortheirownstrategicreviewsandforplanningpurposes.PresentationstoStateassociationshaverevealedthatmanymembersareinterestedinmakingbetteruseofthereportbutfounddifficultiesaccessingthecontent.Wehopethatthisdocumentwillmakeusingthereporteasierandtherebyassistourmemberstodevelopsoundbusinessstrategiesforthefuture.

WhilethisdocumenthasbeenpreparedforGroupTrainingAustraliabyNIEIR,itdoesnotcontainnewmaterial.Itwillpointgrouptrainingorganisationstokeyrelevantpartsofthereportandhelpthemtoseehowthedatacanbemademorerelevanttotheirorganisation.GTOswishingtoobtainadditionalinformationandarrangeanin-houseseminarfromNIEIRarefreetodosobycontactingtheconsultantsdirectly.

JamesBarronChiefExecutiveOfficerGroupTrainingAustralia

uSINg ThIS dOCumENT

Thisisa‘how-to’document.WehavetriedtoavoidrepeatingcontentalreadyprovidedinthemainLookingAheadreport.Whereverpossible,pagereferenceshavebeenincluded(aswellassection,figureandtablereferences)sothetwodocumentscanbereadtogether.Inthisdocumenttheuseoftheword‘apprentice’denotesatraditionalapprenticeasopposedtoatrainee.

GTOsareencouragedtoworkthroughthedocumentfromstarttofinishwherepossible.ItisintendedasaworkingdocumentthatgeneratesasystematicapproachtousingtheLookingAheadinformationandapracticalpathwaythroughthelargerdocument.

UsersofthisdocumentmayfindthatitjumpsaroundattimestodifferentpartsoftheLooking Aheadreport.Thisisbecausethereportwasdevelopedonadifferentbasistothisdocument.

Wherepossibleitwouldbeadvisabletousethestructureofthisdocumentasaframeworkforreviewingyourindividualstrategicplan(oratleastacomponentofthatreview).Thiswillallowuserstodeveloptheirownworkbookofsupportingdocumentation.

ExamININg yOur pErfOrmaNCE

The starting point for any assessment of where your organisation is heading is to examine where you are today and where you have been.

Tohelpyoudevelopyourownsetofperformanceindicators,thereportcontainsaproposedsetinPartE(page129).ThiscomprehensivesetofindicatorsmaybebeyondthecapabilityofmanyGTOsatpresentbutrepresentanobjectiveforsystematicreportingandbenchmarking.Theindicatorsarearrangedunderfiveheadings:

Generalmeasuresofefficiency

Measuresofcostefficiency

Measuresofstaffefficiency

Marketperformance

Measuresofeffectiveness

Thereportusedaninitialsetofindicatorsdevelopedforthe2009questionnaireofGTOs.IfyoustillhavethematerialsuppliedtoNIEIRin2009itwouldbeworthreviewingthisasitwillhelpyoupositionyourorganisationinthereport’svariousgraphsandtables.Ifyoudon’tstillhavethismaterial,thequestionnaireaskedforthefollowinginformationfor2008.

a.HowmanyFTEGTOstaff

b.Howmanyapprentices

c. Howmanytrainees

d.ApprenticesandtraineesperFTEstaff

e. Completionrates(ofthosewhostartwithyourorganisation,howmanycomplete)

f. Howmanyemployersdoyoudealwithonaregularbasis

g.Whatisyourrevenuefrom:

i. Employers

ii.Government

iii.Other

iv.Proportionoftotalforeachoftheabove

h.Whatisyourcurrentbusinessstrategy

i. Survival

ii.Geographicgrowth

iii.Industrydiversification/specialisation

iv.Growshareinexistingmarkets

v. Increasegovernmentrevenue

vi.Allofabove/other

Thisinformationshouldbeassembledbeforeyoustartworkingyourwaythroughthisguidesoyoucancheckyourrelativeperformanceagainsttherestoftheindustry.Attimestheinformationwillbeusedasratios.

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1UserGuide–LookingAhead


COMPARInGyOURPERFORMAnCEAGAInSTIndUSTRyTREndS

PartAofthereportexaminestheperformanceofGTOsovertheperiod2001to2009.Ifyouknowyourownperformanceoverthisperiod,youcantrackthatagainstgraphsforallcontractedtraining,includingexistingworkers(Figure1.2,page13)andallcontractedtrainingthroughGTOs(Figure1.3,page13).Youwillnotethatforallformsofsuchtrainingtherewassteadygrowth(apartfromafallincommencementswiththeonsetoftheGlobalFinancialCrisisinlate2008)whereasforgrouptrainingthenumbershavebeenflat(withapronounceddipstartingin2008).Howdoesyourperformancecompare?

Thegrowthofpeopleinvolvedinallformsofcontractedtrainingandlackofgrowthingrouptrainingnumbersmeansthatgrouptraininglostmarketshareoverthisperiod.ThislossofmarketshareappliesequallytothemarketforapprenticesascanbeseeninFigure1.5,page14.ThereareanumberofreasonsforthisthatareanalysedinPartC,Chapter9(page84).Thisanalysisisundertakenonastatebystatebasisalthoughtheconclusions(page90)aregeneralisedforAustralia(strongemploymentgrowth,increasedapprenticeintensityandotherfactorssuchasthegrowthofcompetitorsandsubstitutes).

YoucanusethereporttolookatgrouptrainingperformanceinmarketswhereyourGTOisactive(regionsandindustries–Appendix1).

RegionalperformanceRegionsarebasedonlocalgovernmentareas(LGAs).DetailsofwhichLGAsareincludedinwhichregionsareprovidedinAppendix7(page434).TheyarereferredtoasSORRegionsastheyaretheregionsusedbyNIEIRincompilingitsStateoftheRegionsreportfortheAustralianLocalGovernmentAssociation(ALGA).InwhichState(s)andregionsdoyouhavesubstantialoperations?

ForasnapshotofGTOmarketshareinspecificSORRegionsin2008,gotoTable13.1(page117).ThisshowstheshareofallapprenticesintrainingineachoftheSORregions(shareofAustraliantotal)andtheshareofGTOapprentices(shareofAustraliantotalfromtheNIEIRGTOsurvey).ThefinalcolumninthistableshowstherelativeperformanceofGTOscomparedtotheshareofthetotal

numberofapprenticesinAustraliainthatSORregion.AnegativenumberindicatesGTOshavebelowmarketshareandapositivethattheyhaveabovemarketshare.HowareGTOsperformingintheregionswhereyouareactive?

InPartA,informationisprovidedforverybroadregions(capitalcity,provincialcitiesandrural).Table1.1(whichisalsousedasthebasisforFigure1.9)showshowGTOshaveperformedinthesebroadregions(shareofGTOcommencementsintotalcommencementsexpressedasanindexwith2001beingthebaseyear).InsomeofthesebroadregionsGTOsimprovedtheirsharebutinmanytheydidnot.HowdidGTOsperforminthebroadregionswhereyouareactive?

AtaStatelevel,alotofinformationaboutGTOperformanceisavailableinAppendix1(page148).InformationisavailableforApprentices,Other(trainees)andAlltraining;itisavailableforIn-training,CommencementsandCompletions,and;itshowsperformanceataStatelevelintermsofgrouptrainingmarketshare.Changesinmarketshareareavailableinbothabsolutenumbersandthreeyearrollingaverages.Itisalsoavailablebyindustrysector(seebelow).ThisinformationallowsyoutogainaverycomprehensiveinsightintohowtrainingisdevelopinginthestateswhereyouareactiveandhowGTOsareperforminginthosestates.

IndustryperformanceAtanationallevel,theperformanceofGTOsindifferentindustrysectorscanbeseeninFigure1.7(page16)andFigure1.8(page17).ThisshowsthatinallindustrysectorsGTOslostmarketshare.Figure1.8showsrelativeperformanceusingthreeyearrollingaveragestoeliminatesomeoftheyeartoyearpeaksandtroughs.Howdotheindustrieswhereyouworkperform?

ThereportshowsthatGTOshavedifferentlevelsofsuccessindifferentindustriessoitisimportanttounderstandtheindustrieswhereyourGTOisworking.GreaterinsightintohowGTOsareperformingindifferentindustriescanbegainedbyexaminingthetablesinAppendix1thatbreakthisdatadowntoastatelevel.TablesinAppendix1showchangesinGTOperformancebymajorindustrysectorfortheyears2001to2009.Thisdataisshownforapprentices,other(trainees)andallformsoftrainingusingbothactualnumbersandthreeyearrollingaverages.

2 UserGuide–LookingAhead

HowtoreadthetablesinAppendix1isillustratedbelow:

ReadingAppendix1

APPENDICESAPPENDIX 1: GTO PERFORMANCE BY

STATE AND INDUSTRY SECTOR 1


STATE AND INDUSTRY SECTOR 1Victoria: apprentices

Category FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009

Gta intraining 4,809 4,565 4,687 4,827 5,140 5,326 5,293 5,351 5,126

aLL intraining 35,149 36,137 38,132 40,389 42,587 44,195 45,536 47,773 48,871

Gta commenced 1,389 1,824 1,921 2,108 2,223 2,118 2,010 2,249 1,668

aLL commenced 13,386 14,418 15,981 17,759 17,657 17,414 18,516 20,645 17,735

Gta completed 982 916 1,019 984 909 1,019 1,062 1,100 1,162

aLL completed 5,774 6,573 7,023 7,282 7,614 8,088 8,649 8,851 9,402

Looking Ahead

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Looking Ahead

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STATE AND INDUSTRY SECTOR 1


STATE AND INDUSTRY SECTOR 1Victoria: apprentices (continued)

GT Intraining Industry Share FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009

agriculture, Forestry and Fishing (a) 14.3% 13.2% 12.8% 12.4% 13.0% 13.7% 13.6% 13.0% 12.1%

Mining (B) 12.0% 11.1% 10.6% 10.3% 10.5% 10.9% 10.8% 10.4% 9.9%

Manufacturing (c) 12.4% 11.4% 11.1% 10.8% 11.0% 11.3% 11.0% 10.6% 10.0%

electricity, Gas, Water and Waste services (D) 15.7% 14.5% 13.9% 12.9% 12.4% 12.2% 11.6% 11.2% 10.7%

construction (e) 15.8% 14.6% 14.1% 13.5% 13.5% 13.0% 12.0% 11.4% 10.3%

Wholesale trade (F) 13.9% 12.8% 12.4% 12.0% 12.1% 12.2% 11.9% 11.5% 11.0%

retail trade (G) 10.6% 9.8% 9.7% 9.6% 9.7% 9.8% 9.7% 9.4% 9.0%

accommodation (H) 6.5% 6.0% 6.1% 5.9% 5.5% 5.6% 5.1% 4.0% 3.8%

transport, postal and Warehousing (i) 16.6% 15.3% 14.7% 14.4% 14.7% 14.9% 14.8% 14.4% 14.1%

information Media and telecommunication (J) 14.1% 13.0% 12.5% 11.5% 10.9% 10.7% 10.3% 10.0% 9.6%

Financial and insurance services (K) 15.0% 13.9% 13.5% 12.9% 12.8% 12.6% 12.2% 11.8% 11.3%

rental, Hiring and real estate services (L) 14.4% 13.2% 12.8% 12.6% 12.9% 13.1% 13.0% 12.7% 12.2%

professional, scientific and technical services (M) 15.2% 14.0% 13.5% 12.8% 12.7% 12.6% 12.0% 11.4% 10.7%

administrative and support services (n) 14.9% 13.7% 13.3% 12.8% 13.3% 13.8% 13.6% 12.9% 12.1%

public administration and safety (o) 10.5% 9.7% 9.4% 9.2% 9.5% 9.9% 9.9% 9.7% 9.2%

education and training (p) 14.2% 13.1% 12.7% 12.0% 12.0% 12.2% 11.8% 11.3% 10.6%

Health care and social assistance (Q) 8.0% 7.4% 7.3% 7.1% 7.0% 7.1% 6.8% 6.2% 5.8%

arts and recreation services (r) 13.1% 12.0% 11.7% 11.3% 11.7% 12.3% 12.3% 11.8% 11.1%

other services (s) 14.3% 13.2% 12.9% 12.9% 13.3% 13.6% 13.9% 14.0% 13.9%

Looking Ahead

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Looking Ahead

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IndustrysectordataisprovidedforGTOshare,GTOchangeinshare(threeyearrollingaverages)andasabarcharttoillustratechangeovertime.

Appendix1SectionforeachState

Actualnumbersandalso(nextpage)threeyearrollinggrowthaverages

Sub-sectionfor‘Apprentices’,‘Other’(trainees)and‘All’



Figure6.1:distributionofproductivity

PartCoftheReportcontainsacomprehensiveanalysisoftheindustryperformanceandcarefulexaminationofthisdatawillallowyoutopositionyourorganisationinthisanalysis(basedonknowledgeofyourownperformance).Thissectionusesdifferentstatisticalapproachestoanalysedatacollectedinthe2009GTOsurveyundertakenbyNIEIR.Asaminimum,youwillneedtoknowyourFTEstaffinglevel(thatisallFTEstaffassociatedwithyourGTObusiness);thenumberofapprenticesandtrainees,and;youreffectivecompletionrateforapprenticesandtrainees.

REAdInGTHEGRAPHS

Figure6.1(page48)reproducedbelowshowsthedistributionofproductivityratesbetweenthe67GTOswhocompletedtheNIEIRsurveyin2009.ThefigurehasbeenannotatedtoshowhowitcanbereadtolearnaboutwheremostGTOssitaswellasthehighestandlowestperformingGTOsontheseeachmeasure.

pOSITIONINg yOur gTO wIThIN ThE INduSTry

Almost(47.8%)halfofGTOshavearatioofFTEstafftoapprenticesandtraineesofbetween17and26

TheminimumratioofFTEstafftoapprenticesandtraineesis8

Themaximumratiois47(46.6667)

Themeanormidpointratiois22(22.1798)


Usingthisapproach,individualGTOscanpositiontheirownperformanceintermsofproductivity(Figure6.1),completionrates(Figure6.2),apprenticesandtraineesperclient(Figure6.5)andsoon.Wherethegraphsaresteep,thereisaverytightconcentrationofperformance.Forinstance,Figure6.5showsthatthedistributionofapprenticesandtraineesperclientformorethanhalfoftheGTOssurveyedonlyrangesbetween1.6and2.6eventhoughthemaximumis12.

HavingpositionedyourownorganisationinthegraphsbetweenFigure6.1and6.9itisworthreviewingthegraphsbetweenFigures6.11and6.19toseehowthesevariousfactorsimpacttheperformanceofGTOs.Forinstance,Figure6.11showsthatscaledoesnotnecessarilyimprovetheproductivityofGTOssurveyedforthisreport.

PEERPERFORMAnCE

TheReportspendssometimeevaluatingtheperformanceofGTOpeersbasedontheirresponsestothe2009survey(chapter7).EssentiallythisprocessinvolvedrankingGTOsbasedonasetofinternalandexternaldrivers(setoutonpage68and70)ofefficiency.Theanalysisthenlinkedrelativelyefficientwithrelativelylessefficientcounterparts(GTOsthataremostalike).TheanalysisaimedtodiscoverwhatmakesGTOsthatsharesimilarcharacteristics,relativelymoreefficient.AfulldescriptionofthefindingsissetoutinAppendix2(page272)andasummaryisprovidedinTable7.1(page69).ForconfidentialityreasonsitisnotpossibletoidentifyindividualGTOsinthisanalysis.

SubsequentanalysisinChapter8ranksGTOsbasedontwoperformanceindicators;productivity(apprenticesandtraineesperFTEstaff),and;averageproductivityandcompletionrates.ThisanalysisthenslicestheGTOsintoquintiles(20percent)andanalysesthecharacteristicsofGTOsineachofthequintileslices.AfullreportonthisanalysisisincludedinAppendix3(page274).Thebodyofthereportfocusesonananalysisofthetopandbottomquintile(page77and78)andthemainconclusionsfromthisanalysis(page79).

pOSITIONINg yOur gTO wIThIN ThE INduSTry


Part D of the report (page 92) looks at future markets for apprentices and the prospects for group training in this context.

ThisanalysiswillbeusefulinconsideringchallengesandopportunitiesforyourGTOthroughto2020.ThescenariousedfortheemploymentforecastsisdescribedinAppendix4(page293).Thescenariodescriptioncontainstheassumptionsthatunderlietheseforecasts.Thecircumstancesonwhichthisscenariowasconstructedmaychangeovertimesoitisimportanttounderstandthiswhenpreparingyourbusinessstrategy.

TheanalysisinthissectionusestheSORRegionsdetailedinAppendix7.ThefirststepinmakinguseofthismaterialistobeclearabouttheregionsandindustriesyourGTOintendstobeactiveinoverthenextdecade.YouwillneedtolistSORRegionsrelevanttoyourbusinessandtheindustrysectors(basedonANZSICsectorsusedbytheAustralianBureauofStatistics).

REGIOnAlSUMMARyTABlES

Forregionsrelevanttoyourbusiness,itmaybeworthassemblingdatafromvarioustablesintoasummarytablesuchastheonebelowusedinpresentationstoGTAStateassociations(thetablesfromwhichrelevantdatahasbeendrawnisshowninthelastcolumn):

Thefirstlinesshowsforecastemploymentgrowthfortheregion(inthiscaseMelbourneCentral)drawnfromTable10.1(page93);thesecondshowschangesinthe

apprenticeintensity(ratiooftotalapprenticeweightedemploymenttototalemployment)drawnfromTable10.2,and;thelastlineshowsanticipatedapprenticecommencementsforthatregiondrawnfromTable10.3.Inthecaseofemploymentandcommencements,changeintheregion’sshareofthenationaltotalbetween1998and2020arealsoshown.Assemblingthedatainthiswaywillallowyoutogainasnapshotoftheforecastsrelevanttoyourregions.Sofortheregionabove,itisanticipatedtherewillbestronggrowthinbothemploymentandapprenticecommencementswiththeregion’sshareofthenationaltotalincreasingonbothmeasures.Thisisdespiteapprenticeintensityfallingbetween2010and2020.ThistablecanbeproducedforeachoftheSORRegions.

IfyourGTOisinterestedinparticularindustrieswithinparticularregions,forecastsforemploymentgrowthbyindustrysectorbySORRegionareprovidedanAppendix5(page312).Apprenticeintensityandapprenticecommencementforecastsarenotprovidedbyindustrybutsomeinterpretationcanbeappliedtotheemploymentfigures.

REGIOnAlRAnKInGS

Asummarytablerankingregionsbasedonanticipatedchangeinapprenticesintrainingbetween2010and2020isavailableinTable14.1(page124).Thisshowssomeregionshavestronggrowthwhileotherswillexperiencenegativegrowth.

fOrECaSTINg fuTurE prOSpECTS

Table1:MelbourneCentralForecasts

Share Table

2006 2010 2015 2020 1998 2020

Employment 255,259 285,270 321,197 361,649 2.4 2.6 10.1

Apprenticeratio* 87 97 93 88 2007 2020 10.2

Commencements 4567** 3740 4918 7655 6.0 7.3 10.3

*Base:1998=100 **2007


GTOGROWTHAndTHREATSTOGROWTH

Chapter12(page104)looksattheprobabilityforgrowthinGTOapprenticesintrainingthroughto2020foreachStateandTerritory(anationaltotalisalsoprovided).ThisanalysisisavailableforeachoftheSORRegionsinAppendix6(page369).Thesegraphscanbereadasfollows:

Thissectionalsoincludesabarchartshowingsourcesofrisktotheseprojectionsfromtwoprincipalareas;macroeconomicgrowthandcrowdingoutduetodemandforskillsgeneratedbytheresourcesindustry.ThisriskvariesforeachStateandRegion.

OPTIMISATIOnAnAlySIS

Chapter13providesanoptimisationanalysisthatessentiallyindicateswhichregionsarelikelytobefavouredbyorganicgrowthandinwhichregionsGTOswillneedtofindtheirowngrowth.ThisanalysistakesfromotherpartsofthereportthreerulesabouttheperformanceofGTOsintermsorproductivityandcompletionrates.ThesearethatproductivityandcompletionratesofGTOswillimprovewhen(a)thereisslowergrowthinapprenticesinaparticularregion,(b)thelowertheratiobetweenapprenticesintrainingandunemployed,and(c)thehighertheunemployment

rateuptoagiventhreshold.Usingtheserules,theReportlookstooptimisegrowthacrossthewholeGTOsectorbyallocating500additionalfieldstafftoregionswheretheycanhavemaximumimpact.ThestudyfindsthatoptimisationcanincreaseGTOmarketsharebuttherearewinnersandothers.Table13.2(page119)identifiesthewinnersandothersfromthisoptimisationstrategy.Itmeansthatthoseregionsnot‘favoured’bythisstrategyneedtolookforotheropportunitiesandapproachesforGTOstoincreasetheirmarketshareastheywillnotbefavouredbyeconomicconditions.

fOrECaSTINg fuTurE prOSpECTS

Figure12.1(a):newSouthWales:Cumulativeprobability–changeinGTOapprenticesintraining–2010–2020(number)

Rangeofprobableoutcomes

Minimumgrowthexpected2010to2020

Maximumgrowthexpected2010–2020

Meanormidpointgrowthexpected


Basedontheforegoing,youshouldnowhavesomedetailedinformationyoucanuseinreviewingyourstrategicplan.AtthispointyoushouldreviewtheindustryanalysiscontainedinPartBoftheLooking Aheadreport.Thiswillrefreshyourthoughtsaboutyourtwomaincustomers(employersandgovernments)andthethoughtsofyourpeersonthreatsandopportunitiesfortheindustry.Chapter5willalsoprovideyouwithawayoflookingatyourbusinessinacompetitiveenvironmentbyreviewingindustrydynamics,yourcustomers,suppliers,barrierstoentry,competitorsandsubstitutes.Atthispointyoushouldhavesomeclearideasaboutthetypeofbusinessmodelyouaretryingtofollow;whetheryouseeyourselfasacommunitygroup,asaregionalbusiness,anindustry-basedoperationorasanationalcorporateentity(whetherforprofitornotforprofit).

Followingthis,youshouldturntoPartE.ThisreviewsthemainfindingsofthestatisticalanalysisandbuildsonthedefinitionoffourGTObusinessmodelsfromPartB.ItstressestheimportanceofbeingclearwhichbusinessmodelyourGTOispursuing,asconfusionaboutthebusinessmodelwillleadtoconfusionaboutstrategy.OfthefourstrategicstepsoutlinedinChapter14(page125),tworelatetounderstandingyourbusinessmodel.Thenextstepistobeclearaboutwhoyourcustomersare,whatservicestheyreallyvaluefromyourorganisationandhowyoucanbuildyourrelationshipwiththosecustomersbyprovidingadditionalservices(consistentwithyourskillsandcapabilities).

OtherstepsyouwillneedtoconsiderinvolvereducingcostsbyamalgamatingservicesthroughmergersorcooperationwithotherGTOsandreviewingtheskillsavailablewithinyourorganisationstoexecuteastrategyinlinewithoneofthebusinessmodels.Thisreport

stressestheopportunityforGTOstoprogressfrombeingacommunityserviceorganisationtoafullworkforcedevelopmentpartner.NotallGTOswillwanttofollowthatpathbutthosethatdowillneedtoreviewtheirstrategy,theirmanagementstructuresandtheirskillsbase.Up-skillingandbuildingrelevantskillsisasimportantforGTOsasitisfortheircustomers.Itwillalsoinvolvechangesinthewayyoutalkaboutyourbusinessandmarketyourservices.Although,itisimportanttorememberthattheexternalbrandneedstobebuiltontheinternalcultureandcompetencies.

SUMMARyISSUESFROMSTATEGTAPRESEnTATIOnS

ThefollowingpointssummariseissuesmadeinStateGTApresentations.

• GTOmodelhasvariablestrengththroughthebusinesscycle,fromregiontoregionandindifferentindustries

• Thefuturewillseechangingdemandbetweenindustriesandregions

• Needclarityofbusinessmodel,targetedstrategy,marketintelligence

• Biggerisnotbetterwithoutmarketandstaffdevelopment

• GTOshavetwocustomerswithdifferentneedsandexpectations

• GTOsneedtotransitionfrom‘whatwedo’to‘howcanwecreatevalueforcustomers’

• GTOscanmovefrom‘problems’to‘solutions’forgovernment(strongpartner)

• AllGTOsneedtocommittoperformancemeasuresandbetterindustrydata

rEvIEwINg yOur STraTEgIC plaN

Community Service WorkforceDevelopment Partner

Service Provider

Community-based GTOs

Industry service organisations

Corporate GTOs

Multi-regional

Community

Industry

Strategic partner

Multiple Service Offer

One-stop-shop


NIEIRcanprovideatailoredpresentationtoanindividualGTOthatwouldformthebasisofahalfday(orfulldayifrequired)strategydiscussionwithyourBoard,seniormanagementteamorboth.Thatdiscussionwouldhelpcraftamediumtolongertermstrategicplanfortheorganisation.Thepresentationcouldincludeallorsomeofthefollowingelements:

AsummarypresentationontheLooking Aheadreport,itskeythemes,rationaleandmessagesthatwouldsetthecontextforthediscussion;

AnanalysisoftheindividualGTObasedoninformationprovidedbythatorganisationaspartofthequantitativesurveyofgrouptrainingorganisationsin2009(assumingtheorganisationparticipated),andanysubsequentinformationprovidedbytheGTO.Elementsofthiscomponentwouldbe;

a. AnanalysisofthebusinessmodelbeingemployedbythatGTOandwhereNIEIRwouldseethatorganisationpositionedintermsofthefourbusinessmodelsidentifiedintheLooking Aheadreport.

b.AnanalysisofwheretheindividualGTOstandsinrelationto(a)itspeers(usingthepeeranalysiscontainedinChapter7ofthereport)and(b)GTOsgenerally(usingthequintileanalysiscontainedinChapter8).Thiswouldprovidesomebenchmarkingfortheorganisationinrelationtopresentproductivityperformanceandarangeofotherfactors(scale,unemploymentrate,hostdensity,otherincome,marketdensity,completionrates,industrydiversity,geographicfocus,completionrates);

AnanalysisoftheGTOcatchmentormaincatchmentsatStatelevelintermsofoverallperformanceand,wheretheGTOoperatesinselectedindustries,industryperformance(basedonAppendix1)

AnanalysisofregionalperformanceforthemainregionswheretheGTOoperatesexplainingemploymentperformance,apprenticecommencementsandGTOshareofapprenticecommencements

AforecastforchangeinthemajorregionswheretheGTOoperatesintermsofemployment,apprenticecommencementsandthepotentialforGTOstogrowmarketshare.

ThismaterialwouldbesummarisedtohighlightwhatNIEIRseesasthemainstrategicconsiderationsfortheGTO.ThesummarywouldsetupastrategicconversationfortheGTOintermsofwhatsortofGTOtheorganisationwantstobe(businessmodel);whattheimplicationsofthisdecisionwouldbeintermsofhowtheGTOisstructuredandbuildsitscapacity,thecustomersitisseekingtoserveandwhatthosecustomersmaybeseekingfromtheGTO.Itwillchallengethisstrategicvisionwithwhatthepotentialmaybeintermsofindustryandgeographicexpansionandtheopportunitiestheremaybetoexpandtheproductorserviceofferoftheorganisation.

Cost:$5,000professionalfeepluscosts(travel,accommodationifnecessaryetc)+GST

Contact:MichaelSpencer,([email protected])

JulieBarker,NIEIR,0394888444

furThEr advICE aNd INfOrmaTION

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Recentreportshavehighlightedtheroleofgrouptrainingorganisations(GTOs)as‘intermediaries’inthelabourmarketlinkingemployersseekingtodeveloptheirskilledlabourforcewithemployeesseekingcareersinskilledoccupations.GTOseffectivelyfacilitatethisrelationship;absorbriskandenhanceoutcomesforbothparties.TheNationalWorkforceDevelopmentStrategy1identifiedintermediariesincludingGTOsas‘brokersofbusinessandskillsdevelopment’whiletheNationalResourcesSectorEmploymentTaskforce2sawthemas‘facilitatorsofskillsdevelopment’.ArecentNCVERreporton‘highqualitytraineeships’identifiedthevalueofGTOsas‘contributingsignificantlytothequalityoftraineeshipsandcriticaltosafeguardingemployerinterestswhilealsoprotectingemployeesfrompotentialexploitation’3.

TheseobservationscomeasGTOsstrugglewithcompetingdemandsplacedonthemandabusinessmodelthathasinherentlimitations.Inresponse,manyaretransitioningthemselvestoabroaderandmorecommercialfocustoensuretheirlongertermsurvival.Thistransitionbringsthecompetingdemandsintosharperrelief.Ascommercialorganisations,GTOswillalignthemselveswithwhataddsvaluetothecustomerswhopayfortheirservices(predominantlyemployers)andreduceoreliminateservicesthatdonothaveaclearcommercialdriver(oftentheservicesgovernmentexpectsthemtoprovide).GovernmentpolicymakersexpectGTOstoprovidesuperiorperformance(intermsofpromotingAustralianApprenticeshipsandachievinghighcompletionrates);toworkwiththemoreexpensiveemployersegments(SMEs),todeliverlabourequityprograms,andtoprovideinputtopublicpolicyformulation(allserviceslackingacommercialdriver).

RecognisingtwokeycustomersandreconcilingtheircompetingdemandsisakeyfirststepforGTOsindevisingastrategyforthefutureofgrouptraining.AtpresentthereissomeambivalenceintheattitudeofGTOstogovernmentandviceversa.GTOsgenerallyseegovernmentincomeasaverysmallpartoftheiroverallrevenuebasecomparedtorevenuefromemployers(lessthanfivepercent)butalso(predominantly)seegovernmentfundingandgovernmentpolicydirectionasvitaltotheirfuture.For(most)policymakersGTOshaveaspecialplaceduetothesheernumberofapprenticesandtraineesemployedbuttherelationshipismovingtoamoretransactionalbasis.ThisfollowsapatternidentifiedbytheProductivityCommission4initsrecentreportonthenot-for-profitsector5.GovernmentisconstantlyreviewingitspaymentstoGTOsandlookingforclearermeasuresofperformanceanddemonstrationofoutcomes.ItalsofundsorganisationssuchasAustralianApprenticeshipsCentres(AACs)thatcompetewithatleastsomeoftheservicesprovidedbyGTOs.

Grouptrainingwillnotonlyneedtorespondtothechallengingpolicyenvironmenttodefineitsfuture,itwillneedtorespondtoaneverchangingbusinessenvironmentandlearnfromitsexperiencethroughtheoscillationoftheeconomiccycle.

1 Australian Workforce Futures: A national workforce development strateg y,SkillsAustralia,Canberra,2010.

2 Resourcing the Future: National Resources Sector Employment Taskforce, DiscussionPaper,AustralianGovernment,Canberra,2010.

3 High Quality Traineeships: Identifying What Works,SmithE,ComynP,BrennanKemmisR,SmithA,NationalCentreforVocationalEducationResearch(NCVER),Adelaide,2009.

4 Contribution of the Not For Profit Sector,ProductivityCommissionResearchReport,ProductivityCommission,Canberra2010.

5 GTOsincludeboth‘forprofit’and‘notforprofit’organisations.Governmentpolicyinitiativestendtositmorecomfortablywith‘notforprofit’organisationsbecausetheytendtonothaveastrongcommercialdriverbut‘forprofits’arenotexcluded(asevidencedbytheGTOnationalregistrationsystemandnationalstandardsrequirementstoaccessgovernmentfunding).

appENdIx 1ExECuTIvE Summary frOm ThE lOOkINg ahEad rEpOrT



THEGROUPTRAInInGBUSInESSMOdEl

Grouptrainingasaconceptisnow30yearsold,thisstudyshowsthatwhileitcontinuestobeaverysignificantemployerofapprenticesandtrainees,itlostmarketshareovertheperiodfrom2001to2009.Thisreporthasidentifiedthreefactorscontributingtothislossofmarketshare:

• strongemploymentgrowthovertheperiodunderminedthecompetitivenessofthegrouptrainingmodel(grouptrainingwouldappeartobelesscompetitiveinatightmarket);

• grouptrainingdidn’trespondtothegrowthinthemarketforskillstrainingeitherbecauseitchosenottoenternewsegmentsthatemergedoritdidnothavethecapacity;and

• grouptrainingfacedotherchallengessuchastheemergenceofAustralianApprenticeshipsCentres(AACs)promotinglowercostalternativestoemployersthroughdirectemployment.

ExaminationoftheperformanceofgrouptrainingoverthiseightyearperiodhighlightssomeofthechallengesthebusinessmodelfacesandwhymanyGTOsarelookingtoexpandtheirbusinessbase.Theanalysisfoundthat:

• demandforgrouptraining(asmeasuredbygrouptrainingshareofallapprenticecommencements)isnotuniformthroughthebusinesscycleandisnoticeablylessinatightmarketforskilledemployees;

• demandforgrouptraining(samebasisasabove)isnotuniformacrossregionsandisinfluencedbylabourmarketconditions(demandislowerwherethereisahighgrowthincommencementsandgrouptrainingislesssuccessfulwherethereareveryhighorverylowratesofunemployment);and

• demandforgrouptrainingvariesacrossindustriesandtendstobestrongestintraditionalindustriessuchaswholesaletradeandtransport(andtoalesserextentmanufacturing,miningandtelecommunications).

Respondingtothechangingmarketandbusinessenvironment,GTOshaveadoptedarangeofapproachesorbusinessmodelsrangingfromthetraditionalcommunityservicemodeltoamodelthatseesgrouptrainingasoneserviceofferedbyanintegratedcorporateentity.NIEIRhasdefinedfourbusinessmodeltypesforgrouptraining:

• acommunitymodel(reflectingtheoriginsofgrouptraining);

• aregionalmodel(regionally-basedenterprises);

• anindustrymodel(generallyfocusedononeindustry),and;

• acorporatemodel(national,multi-region,multi-product).

Itwouldbewrongtoimplythatthereisoneoptimalbusinessmodelorthatonemodelisrightandotherswrong.Thiswilldependonthecircumstancesoftheindividualorganisation(e.g.size,geographicspread,industryspread,purposeetc.).Whilemodelsmayhavedifferentlevelsofperformanceintermsofoperationalefficiencyandcompletionrates,onemodeldoesnotexhibitoptimalperformanceinboth.


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Ingeneral,thereisamovebyGTOstowardamorediverseserviceofferandgreatergeographicspread.However,responsestothechangingbusinessenvironmentarenotuniform.Oneoftheobjectivesofthisstudywastounderstandthedifferentresponsesandtounderstandthemostperformance-enhancingapproachestocreatingafutureforgrouptraining.TodothisNIEIRinterrogatedstatisticaldata,quantitativesurveydata,qualitativesurveydataandNIEIReconometricmodels.Itappliedarangeofanalyticaltoolstothisdata.Someofthekeyfindingsareasfollows.

• Ingeneralthereisacleartradeoffbetweenhigherlevelsofperformanceintermsofproductivity(AustralianApprenticesperGTOFTEstaff)andcompletionrates(proportionofAustralianApprenticescompletingindenturedtraining).

• ForGTOsofthesamescaleandgeographicstructure,afocusoncommunityobjectives(labourmarketequityprograms)canlowerproductivitybyupto25percentandlowercompletionratesbyfiveto10percentcomparedtoGTOswithnarrowcommercialobjectives.

• CorporateGTOsareover-representedinthebestperformingGTOsforproductivity(AustralianapprenticesperGTOFTEstaff)whileregionalGTOsareover-representedinthegroupwiththelowestperformanceforproductivity.

• Scalebyitselfdoesnotleadtosuperiorperformance.LargescaleGTOsareover-representedamongthelowestperformingGTOs.Expansionbyindustryandregionswillnotsucceedunlessitiswell-resourcedwiththerightpeople,relationshipsandresources.

• Industrydiversificationdoesnotbyitselfimproveperformance.Infact,specialisationwillingeneralimproveperformance.

• ForGTOswiththesamegeographicstructureandsingleindustryfocus,thosethatfocusonhighvaluetradeskills(e.g.construction,mining)haveproductivityandcompletionlevelsofbetween15and30percenthigherthanGTOsthatfocusonlowerskills(e.g.hospitality).

• Geographicdiversitybyitselfdoesnotimproveperformance.Givensimilarscale,GTOswithmoregeographicdiversitywillhave25percentlowerproductivityand(potentially)asimilardeclineincompletionratescomparedtoGTOsthatoperateinoneregion.

CurrentperformanceofGTOswasanalysedbyrankingGTOsbasedoneffectiveness(productivityandcompletionrates)andcomparinggroupsofpeerGTOs(similarsize,structure,focus)withthebestperformingGTOinthatgroup.Itshowedperformancecouldbeimprovedthrough:

• targetedregionaldiversification(based,forinstanceonlabourmarketconditions);

• tighterindustryspecialisation

• generally(withcarefultargeting)increasingAustralianApprenticesperhostemployer;and

• diversifyingservices.

MoreeffectiveGTOstendtobedistinguishedfromtheirlesseffectivepeersbecausethey:

• haveastrongmanagementcultureandclearorganisationalobjectives;

• areoptimisedintermsofscaleand/orregionalmarkets;

• areindustryspecialistsratherthanindustrygeneralists;

• havecustomersinhighskillindustries(withanappropriatescaleofoperation);and

• offeradiversityofservicestomeetcustomerneeds.



dEFInInGAFUTUREFORGROUPTRAInInG

GTOshaveasenseofwheretheirfuturelies.QualitativesurveyworkwithGTOspointedstronglytowardamoreintegratedserviceoffer(grouptrainingplusotherskilledemployment-relatedservices),demonstratedperformance,strongexpertiseandbrand.Thisisbroadlyconsistentwithhowemployersseethefuture.Theywantqualitycandidatestomeettheirskillrequirementswithminimalcomplexityatacompetitiveprice.Theywanttoworkwithtrustedpartnerstodevelopskilledemployees.Partnershipswillbebasedonlong-termrelationships,qualitysupervisionandvalueformoney.Whilesimplystated,deliveringonafutureforgrouptrainingwillrequirefundamentalchangesinhowGTOspositionthemselvesinthemarket,researchtheirmarketsandcustomers,stafftheirorganisations,thinkabouttheservicetheyoffer,manageandleadtheirorganisationsandcontrolcosts.

Thefutureofgrouptrainingorganisationswillbeasgenuineintermediariesinthelabourmarketofferingasuiteofworkforcedevelopmentoptionsthatgeneratelong-termvaluefortheiremployercustomers.Mostwillalsoseektomeettheneedsofgovernmentcustomersasvaluedpartnerswhocanbereliedontodeliversuperiorpolicyoutcomes.Afirststepwillbetodefinethebusinessmodelthatbestsuitseachorganisation.

CommunitybusinessmodelNotallGTOswillbethesame.Thecommunitymodelwilltendtohaveacloseaffinitywithgovernmentpolicyobjectives(labourequityprograms)andworkinareasthatarelesscommercialmakingtheseGTOsmoredependentongovernmentsupport.Towinsupporttheywillneedclearperformancemeasures;notgenericmeasuresbutmeasuresthatdemonstrateperformanceinmorechallengingmarketswherecompletionrateswillbelowerandcostshigher(performancerelativetoaparticularcohortratherthangeneralrates).Thestrengthofthismodelwillbeitsrelationshipswithemployersinthecommunity.Buttheywillneedtounderstandtheirmarketandnottakeitforgranted.Theywillneedtolookattheircostsandcouldimproveefficiencythroughaggregationorsharingofbackofficeservices.Theywillneedtolookattheirserviceofferandopportunitiestostrengthenthisthroughalliancesoragreementswiththirdparties.

CorporatebusinessmodelCorporateGTOswillbydefinitionworknationalmarketsstrategicallyfocusingonthemostopportunesegmentswithacomprehensiveskilledworkforceserviceoffer.Theywilldevelophighlevelrelationshipswithseniormanagersincustomerorganisationstounderstandtheirissuesandrecommendsolutions.Thesolutionstheyoffermaybegrouptraining;outsourcedmanagementofapprentices;recruitment;temporarystafforlabourhire.TheywillbeabletoofferservicesofanRTO,anAAC,aHumanResourceconsultantoranagency(recruitment,temp,labourhire).Thedangerwillbealackofkeymanagementcompetencies,staffcapabilitiesandstrategicdiscipline(toavoidpursuingsizeforthesakeofsizeorgeographicspreadforthesakeofbeingnational).Theywillbeabletospreadcostsoveralargerrangeofservicesbutwillneedtoensurethisopportunityresultsincompetitiveprices.Theywillneedtoputtogethermanagementandstaffteamsthatdeliveraqualityserviceatacompetitivepriceandcapturesynergiesthroughintegrationoftheserviceofferratherthansimplyofferingarangeofservices.Themodeldoesnotnecessarilyabandonthecommunityheritageofgrouptraining.Forinstance,anorganisationmayestablishabusinessunitwithinitscorporatestructuretofocusonlabourequityprogramsorservicesforgovernmentcustomers.Trackingandbenchmarkingperformancewouldbejustasimportanttothismodel.



RegionalmodelRegionalGTOswillhaveelementsofboththecorporatemodelandthecommunitymodel.Thechallengeherewillbethedisciplineappliedtomarketresearchandunderstandingtheirregionaswellastheopportunitiesforgrowth.RegionalGTOshavethehighestriskofbeingstuckin‘no-man’sland’particularlyiftheyareinaregionwithstaticorshrinkingdemandforapprenticesandtrainees.Intryingtobe‘allthingstoallpeople’theyrisklosingclarityabouttheircustomerbase,whatgeneratesvalueand(moreimportantly)whatdoesnotgeneratevalue(eitherforcustomersorthemselves).Theywillnormallylacksizeandscaletomaintainacompetitivecostbase,developacomprehensiveserviceoffer,anoptimalmanagementstructureandstaffskills.Inattemptingtorespondtochangesintheoperatingenvironmenttheywouldbepronetomakingbadchoicesbecausetheylackcapacitytoevaluatebusinessoptions.Thefactorsthatgivethemanadvantageintheirhomemarkets–relationshipwithemployers–wouldworkagainstthemiftheychosetoexpandtonewregions(lackofrelationships).ForregionalGTOscooperationagreementstosharebackofficeservicesandbroadentheirproductofferwillbemostimportant(ifnotmergersthatachievethesameoutcomes).Theywillbehighlydependentonthenetworkingopportunitiestoacceleratelearningandadaptationtothechangingbusinessenvironment.Solidmarketresearchwillbevitaltodevelopingtheirstrategyforthefuture.

IndustrymodelIndustryGTOshavetheadvantageofgoodrelationshipsandaclearfocusfortheirbusiness.However,thisreportshowsthatsomeindustriesaremoreopportuneforgrouptrainingthanothers.Eveninindustrieswherethereisarelativelystrongopportunityforgrouptraining,relationshipsbuiltonsolidperformancewillbeimportant(andanaffiliationwiththerelevantindustryassociation).Industry-basedGTOstendtobestrongestinconstructionbuthavestruggledinweakerskillareassuchashospitality.Themainopportunityforimprovementisthroughmarketresearchtounderstandcustomerrequirements,lowercostsandbroadentheserviceoffertorespondtomarketopportunities.

Theriskforindustry-basedGTOswillbefailingtodemonstrateclearperformancetocustomers;forotherorganisationsintheindustry(labourhirefirms)toexpandintogrouptrainingor;tofailtosecurecustomerrelationships(creatinganopportunityforcompetitors).

Thereareanumberofissuesthatapplyregardlessofthebusinessmodelselected.Theseincludethefollowing.

PerformancemeasuresThisreporthasstressedtheneedtodevelopamoresolidbasisformeasuringandevaluatingperformanceofGTOs.Thiswillbenecessaryfornegotiationswithgovernment.Itwillalsobenecessaryasadriverforimprovedperformance.CorporateGTOswillneedtotrackperformancerelativetotheirpeers.Aswell,regionalGTOswillneedtounderstandperformancewithintheirmarketandtheirmarketrelativetoothers.SimilarlyindustryGTOswillneedtolookatperformancewithintheirindustryandtheirindustryrelativetootherindustries.Thepresentlevelofperformancetrackingwithintheindustryshouldbeamajorconcerntoparticipants.

PositioninginthemarketAmajorhandicapidentifiedinthisreportistheexternalperceptionofgrouptraining(communicatingthevaluepropositiontocustomers)andtheinternalperception(manyGTOsarelockedintotheconceptofgrouptrainingratherthanunderstandingtheservicetheyoffer).Grouptrainingdescribesawayofoperating(arailway)ratherthanwhatitdoes(transport).GTOsneedtofocusontheservicestheyprovidetocustomers(andhowthatrelatestowhatcreatesvalueforthem)ratherthancommunicatingaconcept.TheprecisewordswouldneedtobethesubjectofaseparateexercisebutessentiallyGTOsofferworkforcedevelopmentsolutionstoemployersandapolicydeliveryplatformtogovernment.EmphasisingservicedeliveryhasthepotentialtoliberatethinkingwithinGTOsandthegrouptrainingmovementgenerallyandfocusoncustomerneeds.



MarketresearchThereisaconcerninglackofmarketresearch.Scenariosforecastingdemandthroughto2020developedforthisreportshowstherearemajorproblemsonthehorizonforGTOsinanumberofkeymarkets.InmanypartsofAustraliademandforapprenticeswillbestaticorfalloverthenext10yearswhileinotherareasitwillgrowstrongly.Insomeindustries,therewillbelittlegrowthwhileinotherstherewillbestronggrowth.Someindustriesaremoreaccustomedtoworkingwithgrouptrainingandarethereforemoreprospective,othersarenot.GTOsneedtounderstandtheircustomerneedsanddeveloptheinternalcompetencetorespondtothoseneeds.

PeopleandcompetenciesThisreportnotesthatonereasongrouptraininglostmarketsharewasbecauseitfailedtorespondtogrowthintheapprenticemarketoverthepasteightyears.Onereasonwasthatgrouptrainingdidnothavethecapacitytorespondtothismarketshift.GTOswillneedtofundamentallyrethinkandrebuildtheirorganisationsaroundaservicedeliveryrole.CurrentstaffcompetenciescontributetolockingGTOsintotheexistingmodel.AlimitedrangeofcompetencieslimitstheabilityofGTOstorespondtoashiftinthemarketorseeknewopportunities.FewGTOshaveamarketingormarketdevelopmentfunction.Fewhavestaffwiththecapacitytodevelopsuccessfulworkforcedevelopmentstrategiesfortheircustomers.Atleastonehasexperimentedwithhiringdifferent(moreexpensive)personnelandseenrewardsfromthis.Thereisatendency,perhapsstemmingfromthecommunityfoundationofGTOs,toworkwithlowerpaidstaffwithgenerallyexcellentinterpersonalskillsbutlimitedprofessionalcompetenciesin,forinstance,HumanResourcestrategies.

ManagementandleadershipPeopleissuesinGTOsgotothetopinmanycaseswithBoardsthatreflectsolidcommunityfoundationsbutalimitedrangeofprofessionalcompetenciesandseniorstaffwhoareoftendrawnfromwithintheindustryandwhosethinkingmaybelockedintotheexistingbusinessmodel.Oneareaforimprovementidentifiedinthisreportisstrategicfinancialmanagement.GTOsneedtobeabletotrack,benchmarkandimprovetheirperformanceandunderstandtheimpactdifferentdrivershaveontheiroperationssuchasscale,employer(customer)characteristics,marketcharacteristics(size,growth,andunemploymentrates),economicconditions,internalskillandcompetencyneeds.GTOswillneedskillsinmarketresearch,marketing,mergers,acquisitions,alliancesandproductdevelopment.CEOswillneedtothinkholisticallyandstrategicallybutalsounderstandthefinancialdriversoftheirbusinessso‘babiesarenotthrownoutwithbathwater’.

RElATIOnSWITHGOvERnMEnT

Governmentwillcontinuetobeakeyrelationshipforgrouptraining.ItwillsetthepolicyenvironmentinwhichGTOsoperateanddevelopitsownworkforcedevelopmentstrategies.GTOshavetheoptiontoworkwithgovernmentpolicymakersaspartners,helpingthemrealisetheirpolicygoals,ormovetoanincreasinglytransactionalrelationship.ToaccepttheofferofapartnershiphoweverwillrequireGTOstoworkwithgovernmentonsolutionsratherthanjustpresentproblemsforpolicymakerstosolve.TheywillneedtoacceptthatGovernment,likeothercustomers,areinterestedinoutcomesratherthanthegrouptrainingmodelforitsownsake.



Partofthesolutionpolicymakersarelookingforcanbesolvedbydevelopingenhancedperformancemeasuresforgrouptrainingorganisations.Aslongaspolicymakerscanonlyseegeneralacross-the-boardperformancemeasures,GTOswhotakeonhighcostandlowerperformanceelementsofskillsdevelopment(suchaslabourequityprograms,workingwithSMEs,retaining‘outoftrade’apprenticesetc.)willhavetroublecommunicatingtheirperformanceandpolicymakers–nomatterhowsupportive–willhavetroublearguingforongoingsupportwithTreasuryandFinanceofficials.Ontheotherhand,GovernmentneedstobeclearitisaskingGTOstoprovideservicesthatdonothaveacommercialdriverandneedstorecognise(anditlargelydoes)thattheseservicesprovideapublicgoodthatneedstobepaidfor.

WorkingwithgovernmentaspartnerswillassistGTOsgainrecognitionforissuestheyseeasproblemssuchasbuildingtheflowofpeopleintoapprenticeshipsandtraineeshipswithoutadequatereferencetothetypeofpeoplemovingintothesetradesandoccupations.AnumberofGTOshavemadethepointthatsimply‘growingthesizeofthepipe’channellingpeopleintoAustralianApprenticeshipsdoesnotensureanimprovedskillsoutcomeforindustry.EnsuringprogramsareeffectivelytargetedisanareawhereGTOsandgovernmentcanbecomeveryeffectivepartners.ThispartnershipwillnotbeeffectivehoweverifGTOsareseensimplyasprotectorsofthestatusquoasappearstobethecaseinthecurrentdebateovercompetency-basedtraining.

Tomakethisrelationshipwork,GTOswillneedtobeflexibleandtakeabroadperspectiveonworkforcedevelopment(asopposedtogrouptraining).Equally,thereareissuesthatGovernmentwillneedtoaddressandthisreporthighlightsgovernmentfundingforAACsasanissuethatrequiresresolution.ItwouldappeartobeinconsistentwithGovernmentcommitmenttocompetitiveneutralitythatorganisationsfundedbyGovernmentarecompetingwithGTOsintheprovisionofcertainservices(atnocosttoemployers)whenGTOsneedtochargefortheseservices.

GROUPTRAInInGAUSTRAlIA

GroupTrainingAustralia(GTA)willhaveakeyroleindrivingthisagendaforwardandprovidingtheleadershiprequiredtostewardGTOsthroughaprocessofevolutionandchange.ItwillbeimportantthatGTAapproachesthetaskconstructivelyandinclusivelycreatingopportunitiesforindividualGTOstochange.TherearetasksthatGTAwillhavetoleadsuchasthedevelopmentofthebrandthatrepresentstheserviceofferbeingprovided,developmentofperformancemeasures,skillsdevelopment,theindustry’sownworkforcedevelopmentstrategyandcreatingopportunitiesforalliancesandotherformsofjointandcooperativeactionbetweenGTOsthatcanreducecostsandenhancetheserviceofferofGTOs.Inshort,GTAwillneedboththecapacityandthemandatetoprovideleadershiptotheprocessofevolvingthefutureofgrouptraining.



appENdIx 2kEy mESSagES frOm ThE lOOkINg ahEad rEpOrT

Grouptrainingiscurrentlycaughtbetweencompetingdemandsofdifferentcustomers(employersandgovernments)thatarereflectedindifferentGTOpriorities.Someseetheirfirstobligationascommunityservicewhileothersseetheirfirstobligationasstrongcommerciallyviableintermediariesintheworkforce.TheseobjectivesarenotmutuallyexclusivebutneedtoberecognisedasseparateandcompetingdemandsonGTOs;the‘twocustomers’approach.

ThedifficultyofreconcilingthesedifferentdemandsofGTOsishighlightedbytheobservationthatthereisatrade-offbetweenGTOcommercialandcommunityobjectives.ForGTOsofthesamescaleandgeographicstructure,afocusoncommunityobjectivescanlowerproductivity(AustralianApprenticesperGTOFTEstaff)byupto25percentandcompletionrates(proportionofAustralianApprenticescompletingindenturedtraining)byfiveto10percent.

Thecompetitivenessofgrouptrainingwithotherformsofemployment(e.g.directemployment)isnotthesamethroughthebusinesscycle(itislesscompetitiveinatightmarket).Grouptrainingisnotequallycompetitiveacrossregions(demandislowerwherethereishighgrowthincommencementsandislesssuccessfulwherethereareveryhighorverylowratesofunemployment).Norisitequalacrossindustries(moresuccessfulintraditionalindustriessuchaswholesaletradeandtransport).

Fourgrouptrainingbusinessmodelshavebeenidentified;community,corporate,regionalandindustrymodels.Thereportdoesnotshowthatonemodelisbetterthanothers.TheappropriatenessofeachmodelwilldependonthecircumstancesofeachGTO.However,forGTOstooptimisetheirperformance,theyneedtobeclearwhichmodeltheyarepursuing.

Growingsizeandscale,increasinggeographicorindustrydiversitywillnotbythemselvesstrengthenGTOs.Growthinsizeandscaleneedstobewellresourcedwiththerightpeople,relationshipsandresources.Geographicdiversificationneedstobecarefullytargetedand,generally,industryspecialisationwillbemoresuccessfulthanindustrydiversity.GTOsinindustrieswithhighervaluetradeskillswillbemoresuccessfulthanthoseinindustrieswithlowervalueskills.

Thefutureofgrouptrainingwillbeasagenuineintermediaryinthelabourmarketofferingasuiteofworkforcedevelopmentoptionsthatgeneratelong-termvalueforemployercustomersatcompetitivecosts.Mostwillseektomeettheneedsofgovernmentcustomersasvaluedpartnersinpolicydevelopmentwhocandeliversuperiorpolicyoutcomes.

AmajorimpedimenttoGTOsachievingthisfutureisafocusonthemechanism(grouptraining)ratherthantheservice(workforcedevelopment).EmphasisingservicedeliverytoidentifiedcustomershasthepotentialtoliberatethinkingwithinGTOsandthegrouptrainingmovementgenerally.ItwillallowGTOstothinkbroadlyaboutthevaluetheycreateforemployersanddevelopingbroad-basedlong-termpartnerships.

DeliveringthefutureforgrouptrainingwillrequirefundamentalchangestohowGTOspositionthemselvesinthemarket(theirbrand)andtheservicetheyoffer.Itwillrequirecomprehensivemarketresearchofcustomers(byindustryandregion);developmentofstaffcompetenciesandappropriatestructures,and;managerswhowillleadGTOsthroughaperiodofchange,negotiatesharedserviceagreementsormergers,understandmarkets,innovateandtightlycontrolcosts.

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February 2011

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